THE EDITOR, Sir:
I have been involved with electricity supply, generation and sales within the English-speaking Caribbean from 1951 to 1968 and sympathise with the problems of the Jamaica Public Service Limited in the quest to recoup losses caused by the short-sightedness of the operators.
It is the responsibility of the suppliers to budget for possible costs arising from acts of God which cannot be immediately quantified, and the way to do this is by seeking cover from insurers, based on replacement values of productive units of the company. JPS is, obviously, aware of this as a media statement claims that the company has developed a policy of self-insurance but that the reserve pool of funds based on this policy is inadequate because of timing.
temporary cover
One would expect that the company would have sought temporary cover while waiting for their reserves to build up to the required levels. In the circumstances, it is grossly unfair to ask consumers to pay for the company's negligence. In business, there are certain fundamental costs necessary to the earning of income and the price to the consumer is pre-calculated after taking these costs into account. It is foolish to expect the customer to make retroactive reimbursement to the supplier because he missed out items which should have been taken into account in his costing.
special consideration
There are situations that call for special consideration, e.g. fuel costs, and in such cases special consideration is given by the inclusion of a variation cost factor. In 1963, while managing the electricity supply in Dominica, I was faced with substantial rehabilitation costs arising from hurricane damage. If these costs had not been budgeted for, I would have been booted. I was the manager and the buck stopped with me.
In 1988 the Jamaica Public Service Company Limited suffered damaged from Gilbert and the buck for failure to adequately insure was laid at the door of the chief finance officer. He was the wrong man! In this instance, the buck is being passed to the consumer. Wrong again!
Either the JPS is capable of operating the franchise, or it can't. Don't blame the OUR! Have another look at the franchise and do some rethinking.
I am, etc.,
W.S. RICHARDSON F.C.A.
20 Woodlands Court
61-63 Shortwood Road
Kingston 8
